PRUDENTIAL FACES NEW SUIT BY 80 CALIFORNIANS.Byline: Gregory J. Wilcox Daily News Staff Writer Eighty California residents who rejected terms of a class-action settlement with Prudential Insurance Co. of America sued the company Thursday to recover losses they suffered because of agent sales practices. The suit, filed in Los Angeles Los Angeles (lôs ăn`jələs, lŏs, ăn`jəlēz'), city (1990 pop. 3,485,398), seat of Los Angeles co., S Calif.; inc. 1850. Superior Court, seeks compensatory and punitive damages Monetary compensation awarded to an injured party that goes beyond that which is necessary to compensate the individual for losses and that is intended to punish the wrongdoer. that could exceed $400 million, said Ken Chiate, the lead attorney and partner at Pillsbury, Madison & Sutro. The firm of Wilner, Klein & Siegel also is participating in the suit. Pillsbury's involvement in the case is unusual because the firm usually represents corporate clients. The suit involves a practice known as ``churning Firing one group of employees and hiring another. As companies move into newer, high-tech ventures, they often eliminate employees with older skills while bringing on new people who have computer programming, networking and Web experience. ,'' in which agents convinced customers with paid-up life insurance policies to buy bigger policies based on the false assumption that it would not cost them anything. It allowed agents to inflate inflate - deflate commissions, while the cash value of the old policies paid off the new ones - and customers eventually could face big premiums for the new policies. In March, a federal judge in New Jersey approved a settlement offer from Prudential that covered about 10.7 million customers who bought policies between 1982 and 1995. About 750,000 were in California. Customers have until Sunday to file claims under terms of the settlement, and so far more than 330,000 have. But that means that Prudential is getting off easy, Chiate said. ``There is a pittance pit·tance n. 1. A meager monetary allowance, wage, or remuneration. 2. A very small amount: not a pittance of remorse. of policyholders that are filing claims,'' he said. ``This is a windfall windfall An unexpected profit or gain. An investor holding a stock that increases greatly in price because of an unexpected takeover offer receives a windfall. for Prudential.'' Chiate also believes his firm's clients will have a better chances of recovering their losses in a local court and will fight any attempts to move the case to the East Coast. ``We want to be in a local forum with a local counsel,'' Chiate said. Prudential spokesman Bob DeFillippo said the company is aware of the new lawsuit but will not comment on it. Nor would he say how many customers have filed claims against the company under terms of the class-action settlement. ``We've been working very hard along with the state regulators to make certain that all of the policyholders who may have been misled mis·led v. Past tense and past participle of mislead. are aware of the June 1 deadline,'' he said. ``We believe that the (settlement) is fair and equitable.'' |
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